#22 Roberto Rodriguez and Otto Licks | SEPs and the law in Brazil

Licks Attorneys is one of Brazil’s most respected law firms in litigation with a focus on complex, often technology-driven disputes that include standard essential patents (SEPs). With offices in Rio de Janeiro, Sao Paulo, Brasilia, Curitiba and Tokyo, Licks Attorneys combines industry knowledge with legal expertise to assist a wide variety of Fortune 500 high-tech start-ups in Brazil. The multidisciplinary team of attorneys has handled complex commercial and corporate claims over the last 20 years in major sectors including technology, the internet, telecommunications, life sciences, medical device, and finance.

In the podcast, Otto Licks, founding partner, as well as Roberto Rodrigues, partner at Licks Attorneys, elaborate on their experiences from over 10 years of SEP litigation in Brazil. While Brazil was historically in the second wave of worldwide SEP litigation campaigns, the country stepped up to be more and more in the first wave when patent holders plan their worldwide litigation to enforce SEPs. Otto Licks states that litigants can expect quick and efficient decision-making in Brazil. Here, patent holders like the fact that the rate of SEPs that were killed during litigation is almost 0%. One reason is that Brazil follows a bifurcated system, where different courts handle infringement and invalidity. Courts therefore always assume a patent to be valid. Also here the Brazilian patent office has a reputation of only issuing high-quality patents.

Brazilian courts always consider the licensing negotiation track record in their decision making and patent holders must provide evidence that they have entered licensing negotiations before issuing preliminary injunctions. However, Brazilian courts do not determine a FRAND rate. That is also why Brazil has never been involved with anti-suit injunctions in the past.

Another reason why Brazil is an increasing venue for SEP litigation is that the Brazilian smartphone market is one of the largest in the world. Here injunctions really hurt the defendant. Not only because of the market size but also for the high product margins in the market. Smartphone prices are comparably high in Brazil compared to other markets.

Both Otto Licks and Roberto Rodrigues conclude that they expect the number of SEP litigation in Brazil to increase further, maintaining Brazil’s position as a major jurisdiction for worldwide patent disputes.

#20 Taraneh Maghame | SEP Licensing Realities

Ms. Maghame has served as senior IP counsel at Hewlett-Packard and Compaq Computer Corporation and has been a member of distinguished IP law firms Brobeck, Phleger & Harrison and Perkins Coie, specializing in IP litigation, licensing and counselling. She is a graduate of Georgetown University Law Centre and is admitted to practice in California and Washington State, as well as before the USPTO. In 2018, Ms. Maghame was appointed to the European Commission’s Expert Group on Licensing and Valuation of Standard Essential Patents. She has been included in the 1AM 300 World’s Leading IP Strategists for multiple years and is a frequent speaker on patent licensing and policy matters. Ms. Maghame was vice president of wireless programs and corporate development at Via Licensing Corporation, where she developed and managed strategic multi-party licensing programs in wireless and cellular technologies. Before joining Via in 2017, Ms. Maghame served as senior counsel in Apple’s IP and licensing group, focusing on patent licensing strategy and standards, and represented Apple in global standards-related organizations. Before Apple, she was acting general counsel and vice president for M&A, patent policy and government relations at Tessera Technologies. In this high-profile policy role, she helped to found the Innovation Alliance, an organization representing patent holders’ interests before Congress. She has testified before the Senate Committee on the Judiciary and the Federal Trade Commission regarding patent matters. Today Taraneh runs her own business: Maghame IP Consulting PLLC, a firm that provides strategic counseling and expert services focused on IP issues related to the development, use and licensing of standards.

In the podcast Taraneh elaborates on her experience working with SEPs in over two decades. While 20 years ago a few big telecom players owned SEPs and cross licensed these, today the SEP licensing has dramatically changed. This is because of the wide use of standardized technologies such as LTE or 5G and that there is much more at stake now. While the past years show that many SEP licensing deals were successfully closed at the same time patent litigation was dominated by SEP/FRAND disputes. Worldwide disputes may work for large smartphone manufacturers and huge SEP owners, Taraneh believes however that when SEPs are licensed for IoT use cases licensing must be much more efficient. The royalty rates will likely be much lower. Long disputes are not worth the investment for both sides of the table. Even more, it maybe be worth overthinking not only to license on OEM level because in the end it may create more revenue to license a large number of components or modules for a lower rate than the other way around. Also, Taraneh believes that the formation of Licensing Negotiation Groups (LNGs) should at least be considered, given there are no anti-trust issues.

Taraneh helps companies in new industry verticals that use connectivity standards or plan to use connectivity standards in their products. Taraneh believes that regulators should allow the markets to self-regulate but at the same time believes that policy makers should provide more guidance for solutions and especially increase transparency to decrease legal uncertainty in industries where SEP licensing is yet to be established. This is for the good of both the implementers and the SEP holders. From her days at Via Licensing she experienced great collaborations and constructive solutions when patent holders and implementers are open and transparent working together.

This year the Department of Justice, USPTO and NIST withdraw the 2019 SEP policy statement (June 2022). Taraneh is excited to see if we will see anything from the US regulators. While there are rumors for a draft bill that proposes a federal SEP royalty court with global impact, Taraneh believes that because this bill is currently unsponsored and was proposed by the industry it will take some time until anything will be put forward and during that time such a bill will change to considers all the views from the industry.

#18 Claudia Tapia | How to set FRAND rates

“FRAND should be a framework that all stakeholders can innovate on together!“

Dr. Claudia Tapia is Director IPR Policy at Ericsson, where she leads the IPR Policy’s Research team and its activities worldwide. She is a speaker, writer, lecturer and reviewer in IP and standardization-related topics. Prior to joining Ericsson, Claudia was Director IP Policy at BlackBerry. While at BlackBerry, she focused on various aspects of intellectual property, including intellectual property rights policies in standards, global patent policies, as well as licensing and litigation. Claudia holds a law degree from the University of Valencia, an LL.M degree specializing in International Patent Law from the Ludwig-Maximilian University in Munich and a PhD degree on FRAND and Standardization in the telecoms sector from the Faculty of Law in Augsburg (summa cum laude). Claudia is also president of 4iP Council, a non-profit research council dedicated to developing high-quality academic insight and empirical evidence on topics related to IP and innovation, and a member of the Editorial Board of The Patent Law magazine and of the Intellectual Property Magazine and member of the Advisory Board of C-IP2.

In the podcast Claudia, speaking on her own behalf, elaborates about the lack of incentives for standard implementers to negotiate a FRAND license in good faith. Here she explains that companies typically implement the standards subject to SEPs first before anyone even approaches them for royalties. And then when negotiation starts there is little incentive for implementers to find reach a FRAND agreement. That’s why SEP holders must go to court in some cases. Also, she explains that she believes that past damages for the use of SEPs without a license will also not properly compensate SEP holders, because these damages typically only relate to the patent/s that is/are part of the litigation, which represents only a very small share of the whole portfolio subject to be licensed. Moreover, damages do not properly compensate for the additional costs that the enforcement of the patents has created and do not typically sanction bad behavior which in return creates too little incentives for implementers to license in good faith. Put differently, a willing licensee should not be treated the same as an unwilling licensee. Otherwise, willing licensees would be discriminated and there would be less opportunity for innovators to obtain reasonable royalties on a timely manner, which they generally reinvest in the next generation of the standard Claudia explains. Finally, Claudia refers to a legal maxim “Justice delayed is justice denied”. In other words, if legal redress or equitable relief to an injured party is available, but is not forthcoming in a timely fashion, it is effectively the same as having no remedy at all. Purposely delaying of a FRAND negotiation to avoid paying FRAND or force the SEP holder to accept royalties below FRAND, i.e., hold out, could be improved if there was a time limited to such negotiations. Here Claudia believes 12 months for courts to issue their decision regarding FRAND and 6 months for appeal’s court (if appealed) would be more reasonable.

When it comes to the value of 5G in IoT Claudia believes that we will have to wait and see what IoT will bring and how devices in different industries in the end will be connected. There may indeed be use cases where a fiber cable may be more efficient while there will also be many use cases that will need to rely on cellular connectivity. This is particular the case for issues related to security, connected via wireless technologies.

For Claudia, FRAND should be a framework that all stakeholders can innovate on together. Such a framework however also needs compensation on time. Claudia says that too often people do not see the big picture, i.e., they forget how important standards are for innovation today but even more for the future.

#16 Alissa Cooper | Why Standards Matter

“The diversity of the standards development organizations (SDOs) is itself a virtue, as you do not want any SDOs to work the same”

Alissa Cooper is the Vice President and Chief Technology Officer for Technology Policy and a Fellow at Cisco Systems. She leads and supports the company’s technology policy work on artificial intelligence, broadband, and technical standards. In fact, she was the first female chair of the Internet Engineering Task Force (IETF) in 2017, a position she held until 2021. 
Alissa holds a Ph.D. from the Oxford Internet Institute and MS and BS degrees in computer science from Stanford University. Prior to joining Cisco, Alissa served as the Chief Computer Scientist at the Center for Democracy and Technology, where she was a leading public interest advocate and technologist on issues related to privacy, net neutrality, and technical standards.

When first joining the IETF Alissa was impressed by the cooperative nature of standards development where worldwide experts from all over the world meet, discuss, and find alignment on how to set a standard that allows better interoperability for different systems and products in the market. Alissa points out that these experts work for competing companies and that means you do not necessarily trust each other. But that’s a good thing she explains as standards development is about finding consensus about different views. Companies heavily invest in standards development to ensure that there is access to markets, and this only works when all stakeholders take part.

The rules and governance of standards bodies however are very diverse, depending on the purpose, technology, and industry. There are hundreds of private-led standard organizations. These bodies are subject to different procedures and rules and Alissa points out that this heterogeneity is needed to meet the different needs of each industry and technology. While the private standards consortia have individuals or companies as members international bodies such as ITUT, ISO or CEN have countries as members. These more formal bodies set general rules and guidelines, liaising with the private-led standards organizations.

Alissa explains that the standards development process takes place in meetings in different groups and committees within proposals submitted and discussed by its members. Here typically one person, expert, or entity is driving an initial item or proposal that is presented. Standards development in most of these organizations is consensus-driven, which means that all oppositions to proposals and ideas are considered and discussed. This makes sure that the final standards are approved and accepted by all members and thus the industry. Even more, some standards bodies also ensure the wide adoption of standards with testing and feedback loops into the standard development process, making sure that standards can be easily implemented and deployed.

Standard development is a means to influence technology trajectories. This is not only of interest to private companies but also to governments. Considering the geopolitical crises, the past years have triggered a discussion about excluding certain companies with headquarters in certain countries from the standards development. Alissa has a very clear standpoint about those discussions as she believes that the exclusion of any company or country would in the long term always harm the system. She believes exclusion creates parallel processes while competing for national standards will always decrease interoperability and access to global markets.

Alissa says in her final statement that there is an incredible diversity in the standard development ecosystem that is often overlooked. Blanket statements of certain companies or countries that are supposed to be dominating or winning in standards development, ignore, in her opinion, the complexity of the reality. Alissa states that it may be hard to understand the diversity of all these standards development groups but it’s worth understanding this diversity.

#14 Takanori Abe | The Japanese view on FRAND

“Foreign SEP holders should not think Japan is a hostile jurisdiction to the SEP holders because of no SEP litigations recently. We do not know how the current judges render the judgments. Japan has reformed its patent litigation and now plaintiff patentee’s winning rate has increased, and the invalidity rate is below 20%. Thus, Japan may be a good jurisdiction for SEP holders to file a lawsuit.”

Takanori is the founder of ABE & PARTNERS a law firm specialized in intellectual property and international business transaction. Takanori is a leading expert on any FRAND/SEP matters in Japan who understand the SEP situation in Japan like no other. He helps international companies to get a better understanding about how SEPs are treated in Japan, especially about recent court judgements and communications of various Japanese ministries.

Japan yet had only a few SEP cases so far: Apple v. Samsung with a judgment rendered in May 16, 2014 as well as Sharp v. Tesla January, February, and March of 2020. In the podcast Takanori explains and elaborates on the court outcome. In the Apple v. Samsung case e.g. it was decided that the royalty under FRAND condition for iPhone 4 and iPad 2 Wi-Fi+3G is approximately ¥9.96 million ($100,000).

Furthermore, Takanori explains the different public communications that were recently published: Government agencies have published following reports: “Manual of ‘Hantei’(advisory opinion) for an essentiality check” (March 2018,Japan Patent Office [JPO]) (manual, Hantei-E), the “Guide to Licensing Negotiations involving Standard Essential Patents”(June 5, 2018, JPO)(the guide), the “Guide to Fair Value Calculation of Standard Essential Patents for Multi-Component Products”(April 21, 2020, the Ministry of Economy, Trade and Industry [METI]) (the basic concept), the “Intellectual Property Promotion Plan 2021”(July 13, 2021, Cabinet Office)(the plan) the “Interim Report” (July 26, 2021, METI) (the report).

JPO the guide aims to enhance transparency and predictability, facilitate negotiations between rights holders and implementers, and help prevent or quickly resolve disputes concerning the licensing of standard essential patents (“SEPs”). METI published the basic concept because risks involving SEP licensing negotiations and disputes have been increasing significantly. Cabinet Office published the plan to show future IP strategies with seven key priorities. METI published the report because of increasing importance of SEPs in recent years, the number of SEP declarations has been increasing.

Takanori is classifying these cases and reports as either pro-SEP holder, neutral, or pro-implementer. The “manual, Hantei-E”, “the guide” and “the plan” may be classified as neutral, while the decision and judgment in Apple v. Samsung, “the basic concept” and “the report” may be classified as pro-implementer. The reason they are either neutral or pro-implementers and not pro-SEP holder may be because most of the Japanese industries are implementers.

Even though it is perceived that the Japan is more licensee friendly in fact Takanori points out that no one knows whether the Japanese courts are more implementer friendly – the number of cases are yet too small. Takanori believes the main reason there is little SEP litigation in Japan may be that the foreign companies still have the impression that Japan is an anti-patent jurisdiction where the patentee winning rate is low and patents will be easily invalidated. However, this is a misunderstanding as everything has reformed. The winning rate became higher and invalidation rate is now under 20%. While the JPO and the Cabinet Office are on the neutral position, METI seems to be on the implementer’s side and trying to influence future court judgments. It is because Japanese industries are afraid to be sued.

#12 Paul Bawel | How to Manage And Set Up Patent Pools

Paul is Senior Vice President at Access Advance LLC where he is responsible for business development. He has been involved in multiple patent pools and licensing program during his 25+ years as an intellectual property attorney, including for MPEG 2, MPEG 4 Part 2, AVC, HDDVD, BluRay, HEAAC, HEVC and now VVC. Paul started his career to work for General Electric’s licensing department. He went on to work for General Instrument, first as the IP Portfolio Law Director, and then as the Broadband Sector IP Law Director (for Motorola after it purchased GI) managing the IP law department and IP related matters. After that Paul worked for Microsoft as a Business Division Patent Counsel to then work for Acacia Research Group identifying, valuing, and purchasing patent portfolios. Since 2015, Paul has worked for Access Advance, first as Senior VP of Licensing building their HEVC Advance licensing program, and now as Senior VP of Business Development developing, launching and now building their VVC Advance licensing program.

Paul believes that patent pools are important to facilitate standardized technologies such as HEVC or VVC. Patent pools reduce the transaction costs for all implementers. Havening more than just one patent pool (HEVC is subject to 3 patent licensing programs and VVC currently has 2 licensing programs set up), also will in his view not hamper standards adoption. Also, two or three patent pools still reduce the number of licensors. There has been criticism that HEVC was not as successful as AVC, where Paul argues that there is a lot of data tell a different story and that provides evidence of the success and wide adoption of HEVC. In his view the HEVC patent pool situation supported that success. Also, the recent litigation between Access Advance and Vestel was no setback for Access Advance, Paul argues. Here media did not tell the whole story. What is true due to a substantial number of overlapping patents in the HEVC Advance Patent Pool and MPEG LA’s HEVC patent pool to which Vestel was licensed to, the German court In Düsseldorf found the Access Advanced HEVC license not FRAND. Access Advanced in March 2022 therefore revised its policy responding to the Düsseldorf District Court’s December 21, 2021 ruling. Importantly, the court once again did not express concerns with any other facet of the HEVC Advance Patent Pool, including its royalty rates.

One reason why more than just one patent pool was formed for VVC is that not only the licensing rates and licensing models differ across the pool programs, but also the internal revenue sharing policies can be very different. At Access Advance Paul states that the pool considers the internal royalty sharing counting patents on a patent family basis so that there are no incentives for patent pool licensors to file e.g. multiple divisional patent applications that cover very minor inventions just to increase their share in the patent pool. The different rules and licensing rates therefore attract different SEP licensors to either join Access Advance or MPEG LA’s VVC patent pool

#10 Mark Cohen | SEPs and the law in China

Mark Cohen（柯恒} is a Distinguished Senior Fellow and Director of the Berkeley Center for Law and Technology at the University of California, Berkeley. He has served as the Senior Counsel, China for the USPTO. Formerly, he was Director of International Intellectual Property Policy at Microsoft Corporation. Prior to that time he was Of Counsel to Jones Day’s Beijing office. Before then, he served as Senior Intellectual Property Attaché at the U.S. Embassy in Beijing and as Attorney-Advisor in the Office of International Relations at USPTO. In total, he has nearly 30 private, public sector, in house and academic experience on IPR issues in China.

In Marks view:

“China is a much more complex and a much less transparent environment than many think it is. If you do not have a governments relation person on your team and if you can’t mine the docket data you can’t win a Chinese SEP litigation.”

Mark has over the years conducted several empirical analyses of the Chinese legal system and SEP litigation cases have drastically increased. SEPs are of the highest importance in China and very often relevant and on the agenda of board room decisions. Here the Chinese patent and legal system has seen a great development. Courts are efficient and, in some cases, often faster than US or European courts. However, still the legal system lacks transparency as not all decisions are public, and the litigation dockets are incomplete. As to the publicly available data it looks as if SEP decisions with Chinese companies involved do not rule in favor of the local Chinese companies. However, if rulings and decisions are not all public it’s very difficult to confirm that with the given data. Also, while judges have access to the dockets and other do not, we see decisions that reference nonpublic court rulings which creates confusion and makes it difficult to win a case.

Despite the incomplete data China has however gained importance as being an international venue for SEP litigation. This may not be surprising given that most worldwide sold smartphones are manufactured in China and that the Chinese single market is the biggest in the world for SEP relevant products such as phones, tablets, smart watches, TVs and so on. SEP owners one the one hand find it adventures to litigate in China as injunctions are much more frequently granted. However, on the other hand damages are much lower compared to Europe and the US. China is not the country of unlicensed products anymore and Intellectual Property enforcement is taken much more seriously. However, Mark stresses again cases matter and if not all of them are public we have a problem as lawyers and judges need to be able to reference and consider decision from past cases.

Mark also worries about the increasing cases of anti-suit and anti-anti-suit injunctions. The Chinese legal system should not be underestimated, and its power and influence will grow. So are the increasing number of internationally active patent owners. Indeed, the IPlytics data confirms that Chinese companies have had the highest growth rates in SEP declarations and standards contribution submissions over the past 5 years with increasing numbers of patent filings not only in China but also granted in the US and Europe. Mark believes that the WTO (World Trade Organization) should help in aligning international rules and guidelines and should be much more recognized not only by China but also the US and other countries.

Mark also discusses the trade war between China and the US and the ban of some Chinese companies on the US market. A company such as Huawei that is banned from selling products in the US but is one of the largest SEP holders in the world with a large valid US portfolio creates a risk for US operating companies. If there is no need to cross license Huawei acts like an NPE in the US and may enforce patents much more aggressively. Also, to recoup its R&D investments and missing income from the product market.

#8 Pio Suh | SEP monetization and enforcement

Since July 2018 Pio Suh is assigned as the Managing Director of IPCom based in Munich, Germany. He is an attorney and member of the German Bar since 2006. Pio has over a decade experience in SEP licensing and patent litigation in the field of communication technologies. He has worked in-house for several multinational Fortune 500 companies – including Qualcomm, Oracle and Philips – to implement patent licensing, enforcement and litigation strategies on a global scale.

When IPCom was founded 15 years ago everything started with licensing the GSM and UMTS SEP portfolio acquired from Bosch. Today Pio explains that IPCom is not only acquiring SEPs from other patent holder, but as a company acts as an active contributor to the 3GPP standard development. Indeed, the IPlytics contribution data confirms over a hundred contributions submitted to the 3GPP since 2016 for specifications related top 4G and 5G technologies.

Pio talks about how the legal environment changed from his time at Philips, where the licensing team back then was able to get injunctions on SEPs much easier, compared to today where in Europe it became very difficult to get injunctions for SEPs. In his perspective, with the missing threat of an injunction, a situation where the licensee delays the process is inevitable. Why would a licensee promptly pay and accept an offer if there are no costs for delay?

Pio says that:

“for a SEP licensee it is always cheaper to delay the process.”

If the licensee has not inventive to speed up the process, they will prolong the negotiation. Here China for some cases at least, has proven to be more efficient in granting preliminary injunctions.

Pio goes on to talk about the different perspectives on what is a fair reward for providing access to patented standardized technology. And for understanding what’s FRAND in his view it also depends on the unit that must be considered. In his opinion a telecommunications carrier should pay royalty for SEPs depending on the number of network subscribers. In other words, the users of the network. Carriers argue however that one must use the net selling price of a base station as the basis to determine FRAND. Therefore, carriers do not want to pay royalties but point the finger at the base station manufacturer such as Ericsson, Huawei or Samsung. However, in Pio’s view, base stations are not the accurate unit to represent the value the patented technology brings to the users. This general misalignment about what the basis for FRAND determination should be and who should pay in the value chain makes it difficult to negotiate.

IPCom owns SEP portfolios in the cellular telecommunication space. Here the handset manufacturer market is quite easy to identify. Pio explains that the barrier to get a product on the handset market is quite high and needs significant investments in R&D, know how, manufacturing facilities supplier networks and so on. This is very different for example to printing and pressing a DVD – where Pio targeted licensees during his time at Philips – and here the licensee market looks very different. For handsets consequently, only larger corporations such as Apple, Samsung, Huawei, HTC but also new player such as Xiomi, OPPO or Vivo are on the market, who are the licensees that IPCom approaches. While easy to identify and big pockets guaranteed, these companies are very experienced in defending themselves and that makes licensing quite challenging.

Pio stresses in his final remarks that for him it often goes back to the fundamentals of intellectual property rights. Imagine someone wants to use the house you own and live in .Yes you can rent out your house but you can still decide who is allowed to rent it and for what price. For intellectual property you have the same rights and the legal system must ensure that you are able to enforce your rights and that you will receive a fair compensation for the use of your rights.

#6 Christa Laser | SEP litigation and legal trends in the US patent system

Professor Christa Laser comes to Cleveland-Marshall after nearly a decade of practice experience as an intellectual property litigator at the law firms WilmerHale and Kirkland & Ellis LLP. She has deep expertise in patents, trademarks, copyrights, false advertising, pharmaceutical litigation and regulation, and technology law. She has represented leading life sciences and technology companies in all stages of trial and appellate matters and consulted on legislative changes to intellectual property laws.

In her time during law practice, she gained a lot of experience representing clients such as Samsung or Lenovo in their defense strategy around standard essential patents (SEPs). SEPs play a particular role in litigation as in such litigation it is not only about questions such as validity or infringement but also about the obligation to disclose SEPs or the big question of what a FRAND rate is. Disputes in other spaces are very different. In bio tech for example the infringement is often not challenged as typically both parties agree on what the compound looks like and how it’s used. Standardized technology is in comparison much more complex and it is thus much more difficult to find evidence for infringement.

“One challenge with SEP litigation is that infringement is happening globally, while patent litigation is always local.”

And related to that we see a lot of SEP litigation where courts file so called anti suit injunctions. A court would issue such an injunction to prevent other courts from deciding the same issue at the same time. This is set to make sure that questions in litigation are decided by only one court. If we don’t do that, we would have chaos as two countries would decide on the same issues that are overlapping and then parties would need to figure out which decision e.g. on rates applies where? The real complexity starts when we have an anti-suit injunction from one country and another country does not agree and files an anti-anti-suit injunction to continue the litigation process. This kind of back and forth creates a lot of inefficiencies and should be avoided as Christa believes we must respect each other legal systems.

After years of legal practice at the major law firms Kikland & Ellis as well as Wilmehale Christa decided to change careers to become a law Professor with the focuses on intellectual property and innovation. She wanted a change in her career to more objectivity look at the legal space. During her law practice she always had to represent one side of the table finding arguments to help the client win. Now she can look at issues from the outside. She still uses her practical experience with teaching her students that get presented real cases where they must then develop a strategy to win the case. Her approach is called the Socratic method a form of cooperative argumentative dialogue, based on asking and answering questions to stimulate critical thinking and to draw out ideas and underlying presuppositions.

Finally, Christa talks about her personal career and the challenge to manage working late hours at a law firm while having two kids being the main responsible childcare parent. She experienced a lot of support from her colleagues and people that helped her along the way, but she still felt it was often very hard to manage. In general, yet women are still expected to give up their careers when having children and the situation is not qual compared to men. Christa can be seen as a role model for many women as she showed others that you can have a career while having children. However, the whole system is a long way from supporting strong women in their career path. We still see a majority of males higher management positions, we still see many more male inventors e.g. listed on patents compared to women and the list goes on where even in the venture capital investment space, women less often receive investments even though statics prove women to be the more successful founders. All that must change, and our society must find ways to make this change happen.

#4 Justus Baron | An economist’s view on FRAND in light of the current SEP policy debate

Justus Baron (PhD) is a Senior Research Associate at the Center on Law, Business, and Economics at Northwestern University’s Pritzker School of Law. His previous research positions include Mines ParisTech, Cerna (2009-2012) and Sciences Po Paris, Department of Economics as an Adjunct lecturer and researcher (2012-2013). He has also served as a visiting researcher at the Hitotsubashi University, Institute of Economic Research and Technische Universität Berlin, Chair of Innovation Economics. Justus met Tim during his PhD in 2009, when they worked together in Berlin and Paris. In 2009 they were among the first economists to use patent declarations data from SSOs such as ETSI, IEEE or ITUT to empirically study the interplay of patents and standards.

Today, Justus’ research on technology standards and SEPs has been published in leading academic journals, including Research Policy, the Journal of Economics, Management, and Strategy, and the International Journal of Industrial Organization. Justus has authored several policy reports on FRAND licensing and standards organizations, in particular for the European Commission; and he was a member of the European Commission’s SEP Expert Group. Just recently the European Commission (DG GROW) has commissioned a new study to a consortium led by Justus and Tim and other consortium members, assisting the European Commission with an “Economic Impact Assessment on Standard Essential Patents (SEPs)”.

In the Podcast Justus elaborates on the topics that this empirical research study will cover, including the identification of potential inefficiencies and costs both for SEP holders and standard implementors in the process of agreeing to a FRAND license. Justus addresses several of the big questions around SEP licensing, such as what stage in the value chain SEPs will be licensed and how one can define a FRAND rate. Justus also sheds light on questions like how should regulators such as the EU Commission be involved and who defines the standards on how FRAND should be negotiated? Should standards organizations be involved in SEP determination or FRAND rate discussions? Such questions of governance must be answered by studying the impact of regulation and what incentivizes these sets. Justus feels that as an empirical economist, he can contribute to a better understanding of some complex aspects of FRAND and SEP licensing.

Transparency about SEP issues is important, but here transparency also means to be transparent about the limitations of data and empirical analysis. In the end, the available information is never perfect and we have to consider that in any analysis that we do. In his work for the European Commission’s SEP Expert Group, it was very important to reflect different views and to produce a balanced report. In order to keep that balance, the report reflects many individual experts’ viewpoints and specific recommendations, rather than aiming for a consensus view on inherently controversial issues. That in the end may have also been why some criticized the European Commission’s SEP Expert Group final report as falling short of resolving some of the open controversies. Justus is among the leading economists that study SEPs, and he believes the next years will be even more interesting when the licensing of SEPs for IoT will start to pick up.

#2 Jon Putnam | How to determine a FRAND rate for standard essential patents?

Jon Putnam founded Competition Dynamics as a platform for economic research and testimony at the intersection of intellectual property, competition, and international trade law. From 2001 to 2005, Dr. Putnam held a professorship in the Law and Economics of Intellectual Property at the Centre for Innovation Law and Policy, University of Toronto. Dr. Putnam has also held academic appointments at the Boston University Graduate School of Management, Columbia University Schools of Law and Business, Vassar College, and Yale College. Dr. Putnam has been retained in more than 100 consulting engagements and has testified more than 40 times in patent, antitrust, copyright, trade secret, contract and tax actions in federal, state and bankruptcy courts; before the US Federal Trade Commission, International Trade Commission, and Tax Court; in US and international arbitrations; and in regulatory proceedings in Canada and India.

“We had access to all SEP license contracts since the year 2000 (FTC v Qualcomm subpoena) to compare the royalty rates. It turned out the rates per patent are the same across, 2G, 3G and 4G.”

In the interview Jon revealed some of the SEP related litigation cases he worked on. In one case, the Qualcomm ITC litigation, all US based SEP cross licensing agreements were subpoenaed. That why Jon and his team was able to create a database how much royalties per paid for 2G, 3G and 4G per SEPs. The results confirm that the price per patent did not increase in standard generation advances. Which in his opinion makes sense as the same R&D efforts and spending per patent was conducted by the companies.

In another litigation case, Jon and his team looked at in total 8 SEP determination studies for 2G, 3G and 4G. The argument is that expert witness reports that e.g. use a sample of declared patent to extrapolate this to the overall number of SEPs per standard are biased and the sample as well as the claim charting method is not straight forward and different experts arrive at different results. In light of these disagreements and findings of unreliability, Jon and his team developed a comprehensive method to estimate the likelihood of essentiality for each major contributor’s patent portfolio. Here they took into account systematic differences in essentiality probabilities across the studies, contributors and standards. This method aggregated all available information across the studies, and thus forms the single best estimate of essentiality for any given contributor’s portfolio. Jon argues that “best estimate” is therefore the single best observable proxy for the unobservable beliefs held by each party to portfolio licensing negotiations. Jon and his team also relied on this method as part of computing the relative strengths of industry patent portfolios to predict the payments observed in SEP licenses, in the recent Apple v Qualcomm litigation. The results show that expectations of each portfolio’s essentiality rate are an important component of the portfolio’s relative strength.